Farming preparations in disarray

The Financial Gazette

18 September 2014

WITH less than two weeks before the start of the 2014/2015 season, indications are that Zimbabwe has not adequately prepared for the coming summer season for it to achieve the maize target of 2,2 million. The agricultural industry requires at least US$2,5 billion to guarantee a successful 2014/20-15 season and government is yet to raise US$252,3 million of that amount. Farmers are already jittery and complaining that input distribution, especially to communal farmers, who are the main producers of the country’s staple maize, is yet to begin.

Finance Minister Patrick Chinamasa, said government is mobilising about US$252,3 million for the 2014/15 agricultural season. Presenting the 2014 Mid-Year Fiscal Policy Review Statement, Chinamasa said each communal and A1 household would be given 50kg of Compound D and 50kg of ammonium nitrate (AN) fertiliser, as well as 50kg of lime and 10kg maize seed pack from the money being mobilised by government.

Farmers’ unions have indicated that to achieve the 2,2 million tonnes on two million hectares, government should have already started moving the US$184,8 million worth of inputs to the 1,6 million communal, old resettlement, former small scale purchase areas and A1 households. To achieve the two million hectares, US$600 million is required and Commercial Farmers Union president, Charles Taffs, emphasised the need to re-establish the value chain to achieve the set targets.

“There is need to deal with the elephant in the room because right now banks are not lending; we have become uncompetitive because there is no money to fund agriculture,” Taffs said.

Over 500 000 tonnes of compound D and Ammonium Nitrate will be required to meet the national requirements. Zimbabwe Commercial Farmers Union president, Wonder Chabikwa, said in an ideal situation, distribution of inputs should be done between June and July.

“To meet the national requirements, the target for this year is 2,2 million tonnes. This will enable us to ensure food security and cut on the ballooning grain import bill. Anything above the 2,2 million tonnes will be surplus and for export. As a nation, we have the capacity to exceed our consumption requirements,” Chabikwa said.

Under-utilisation of land and poor grain harvests have seen the country spending over US$3 billion in direct imports of maize and wheat since dollarisation in 2009. The 2013/14 season’s success was partly a result of government’s timely intervention through the US$160 million support for the communal, old resettlement, A1 and small scale farmers, including a good rainfall season.

For the A2 farmers, government announced last year that it will not be financing the commercial producers and urged farmers who benefitted from land redistribution to approach banks for funding instead. The embattled banking sector has, however, been accused by the government of charging punitive interest rates that are making agriculture unviable.

“We do not even encourage our farmers to borrow from the banks because the 18-25 percent interest charged by these banks is highly unproductive. Until we get a single digit interest rate, borrowing from the banks is not an option,” Chabikwa said.  Zimbabwe Farmers Union vice-President Berean Mukwende urged farmers to increase yield per hectare from the current national yield of 0,8 tonnes per hectare.

“We may continue making targets in terms of yields, hectarages and even open up more land but that is no longer necessary. It should be noted that there is need to double the current yields to at least 1,5 tonnes per hectare. When it comes to finance, it is an open secret that banks have not been able to lend to individual farmers but for those that produced maize this year, the Grain Marketing Board provided a guaranteed market for most producers at US$390 per tonne. As a result A2 farmers should be able to finance their own crop,” Mukwende said.

Mukwende called on government to start distributing the inputs intended for the communal and smallholder farmers. “2014 was a better season compared to the previous season; we should stop talking about the inputs and start distributing the inputs to the intended beneficiaries.”

High input costs have prohibited most farmers from self financing their farming activities with many opting for contract growing. To produce a hectare of dryland maize, farmers would need at least US$1 055, with a bag of compound fertiliser selling for US$35  and US$36 for AN in Harare, while for farmers, depending on the distance they are forking out US$46 per bag in areas like Mhangura.

Zimbabwe National Farmers Union vice-president Garikai Msika highlighted the complexities of the 2014/15 season with reference to the rainfall predictions. Rainfall forecasts indicate that the season will generally start normal during the first half but below normal rains are expected to affect half of the country during the second half of the summer season which usually begins in October and ends in early April.

“If we are to get at least US$600 million from the US$2,5 billion requirement it will go a long way in changing the complexion of the whole season. We also need to maintain the 1,4 million tonnes achieved this year although we will be happy to achieve the set targets,” Msika said. He added that there was need to fully capacitate farmers in the northern parts of the country so that the crop will be enough to cater for the southern parts of the country that are expecting an average to below average cropping season. For the 2013/2014 season, improved crop outputs were registered with respect to maize, tobacco, cotton, sorghum, sugar-cane and soya beans.